Maryland counties, tracks need a new source of cash

November 21, 2006

Maryland officials learned last week that the state's so-called "structural deficit" - the projected gap between revenues and expenses - has grown from $4 billion to $5.8 billion.

Legislative leaders such as Senate President Thomas V. Mike Miller have all but ruled out tax increases, saying he feels that "belt-tightening" will be the preferred option in 2007, with aid to local governments a prime target.

Before that happens, we recommend that lawmakers take another look at a fundraising option that every state bordering Maryland is using - slot machines.

Outgoing Gov. Robert Ehrlich's best chance to pass the bill was his first year in office, when he could claim a mandate for legalizing slots. But his bill was a tacked-together mess and he had no real strategy for convincing House Speaker Michael Busch to allow an up-or-down vote.

Advertisement

Now we have a new Democratic governor who has just learned that legislators probably aren't going to give him much slack, but will allow him to make cuts that will be unpopular with citizens who want more for schools, roads and other necessities.

Not only do slot machines have the potential to raise money without a tax increase, they may be the only way to save the state's horse-racing industry.

O'Malley said last week that he favors doing that, provided the sites are limited to race tracks and that gambling be limited to slots, as opposed to full-blown casinos.

Think the horse-racing industry doesn't matter to you? Consider this:

At the start of the 2005 session, a group that included Magna Entertainment, which owns Pimlico and Laurel Park, the Maryland Horse Breeders Association and the Maryland State Fair and Agricultural Society made a report on horse racing to state lawmakers.

The group's officials told lawmakers that breeding and horse racing in the state have a $1 billion impact annually on the state's economy.

In addition, its report said that horse breeding makes it profitable to preserve 200,000 acres of green space in the state.

Preserving green space means less urban sprawl, which means the taxpayers won't have to pay for as many new roads, schools and public safety employees such as police, firefighters and paramedics.

Slots at the state's horse tracks would be a source of revenues and preserve the 20,000 jobs that Aris Melissaratos, Maryland's secretary of Business and Economic Development, said in 2005 were racing related.

Now it's up to O'Malley to provide a bill that's well-crafted and devise a strategy to get Busch on board.

As we noted recently in an editorial on Pennsylvania slots, the money won't start flowing immediately, so the new governor would be smart to have a bill ready when the 2007 session opens in just a few months.